At Wednesday morning’s hearing before the U.S. Supreme Court in the much-hyped American Needle case, the nine justices who’ll decide the controversy “seemed skeptical” (per the Associated Press) of the NFL’s argument that it is a “single entity” that is immune from one of the primary antitrust laws relating to the actions of separate business that come together to restrain trade (by, for example, fixing prices).
But little can be gleaned from the questions asked by individual justices to the lawyers who present the various sides of the case. At the end of the day, it takes only five of the nine robe-wearing government employees to control the outcome.
We’ve reviewed some of the many briefs submitted on the issue, and we saw nothing in the NFL’s paperwork suggesting that the league currently hopes to obtain a finding that it is one business for player-acquisition purposes. Still, the NFL apparently has raised that argument in past antitrust litigation filed after the union decertified and sued the league 20-some years ago, arguing that efforts by 32 distinct businesses to set joint rules regarding salaries, free agency, and the draft violate the same law at issue in the American Needle case, which arises from the league’s decision to give an exclusive 32-team hat and apparel contract to Reebok.
The NFL and the NFLPA have taken very different approaches in the days leading up to Wednesday’s oral arguments. The league has opted not to discuss the matter beyond the confines of the court proceedings; the union has decided to launch a P.R. campaign, which included an op-ed item “written” by Saints quarterback Drew Brees.
The gloom-and-doomers think that the ultimate decision could dramatically reshape American sports. And they’re right — it “could”. But even a right-tilting Supreme Court has its limits when it comes to favoring business interests. The notion that the Court would conclude that the 32 NFL franchises do not compete with each other for the services of players and coaches is ludicrous, and such a ruling would represent a gross miscarriage of justice.
So what is the union’s strategy? We think that the players are trying to establish traction with the American public regarding the quest to be perceived as the “good guys” in the looming labor battle. Moreover, with the union regarding an attack on the NFL’s antitrust exemption for broadcast purposes as the nuclear option (which could trigger mutually-assured destruction) in the ongoing CBA negotiations, the NFLPA likely thinks that any related topic represents a prime opportunity fire a shot across the NFL’s bow as to the one significant area of antitrust law in which Congress already has given pro football a pass.
UPDATE: David G. Savage of the AP provides a more detailed assessment of the argument, which indicates that “most” of the justices were skeptical of the “single entity” theory, which means not only that a broad ruling is highly unlikely, but also that the dismissed claims of American Needle could be reinstated.